The structure in a wellbore of an oil or gas well generally consists of an outer production casing and inner production tubing installed inside the production casing. The space between the production tubing and the casing is generally referred to as the annular space.
Oil and gas wells generally produce both liquids and gas. The produced liquids are produced through production tubing installed in the wellbore. The production casing can be used to introduce downhole equipment or other fluids into the wellbore. The annular space allows for free gas to be separated from the produced liquids and provides a conduit for the gas to flow to surface.
For wells that produce both liquid and gas, a pump positioned at the bottom of the well pumps the produced liquids to the surface through the production tubing. The pump is typically a liquid pump and any amount of gas that is produced through the pump reduces its efficiency and can damage the pump. Rather than the gas being pumped up through the production tubing, the gas is allowed to flow to surface through the annular space. If a gas well does not produce liquids (or only small amounts of liquids), then gas can be produced up the production tubing.
As the free gas accumulates in the annular space, it increases in pressure and can negatively influence the production of the well. To deal with this problem, some oil well wellhead installations have a system for venting or for burning off the gas, which has been produced. However, the venting or the burning of the gas is a waste of this resource and can cause undesirable environmental problems.
A second option is to provide a connection from the annular space to a gas compressor to direct the gas out of the annular space. Know gas compressors are skid mounted units installed in proximity to the wellhead assembly and connected to the wellhead assembly through piping. A problem with known gas compression systems is that they can be bulky. The space available for the wellhead assembly is often limited. The addition of a compressor to a surface assembly will increase the footprint of the well and can result in a surface assembly which is too large for the available space.